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Prairie Mining shares drop on legal update for Polish project

Deal talks are ongoing though Prairie has updated investors on the latest complication in its legal dispute in Poland

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Prairie shares were down 11%

Prairie Mining Ltd (LON:PDZ) saw its shares drop 11% after updating investors on complications in its legal dispute in Poland.

The company last year filed a civil law claim against Poland’s Ministry of Environment (MoE) after it wasn’t awarded a usufruct agreement over the areas that form the Jan Karski mine.

After that, the Polish civil court granted an injunction preventing the MoE from granting prospecting, exploration, mining concessions or other usufruct agreements with any other party until the court proceedings were concluded.

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Now, however, an appeal court in Warsaw overturned the civil court's decision and lifted the injunction.

“Prairie believes that the appeal court's decision is fundamentally flawed as it has the effect of retrospectively applying the August 2018 amended version of the geological and mining law and (incorrectly) concludes that Prairie did not have a priority right over the entire Jan Karski (Lublin) deposit,” the company said in a statement.

It added: “Prairie's civil law claim against the MoE for failure to grant the company with a mining usufruct agreement at Jan Karski remains ongoing and is not impacted by the appeal court's decision to lift the injunction.

“The appeal court's decision is further evidence of the unfair and inequitable treatment faced by Prairie as a foreign investor in Poland and the company will, therefore, consider all other actions necessary to ensure its rights are preserved.”

Additionally, the company noted that transaction talks are ongoing with Jastrzębska Spółka Węglowa SA (JSW) and, in a recent report, JSW said it would like to conclude the basic terms of a potential deal for the Debiensko and Jan Karski projects by the end of April.

Prairie shares were down 2.6p or 11% changing hands at 20.9p.

Quick facts: Prairie Mining Ltd

Price: 10.5 GBX

LSE:PDZ
Market: LSE
Market Cap: £22.29 m
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